System Trader’s and Market Timing traders may use the 50 day Simple Moving Average as their trading plan. The 50 day moving average is basic technical analysis. It is a good market timing trading plan for active trading in indexes and ETF’s that have trend following characteristics. It can produce disastrous results if used for every stock index, ETF, or stock.

Other widely followed moving averages are the 100 day moving average and the 200 day moving average. Some money managers will use these moving averages with a shorter moving average and use the cross of the shorter moving average above or below the longer moving average to generate trading signals. The Wall Street Journal displays the 65 day moving average in their charts. The goal of two moving averages and even 3 moving averages is to eliminate whipsaws that often occur with moving averages as a technical analysis indicator.

Why should you care about the signals produced with the 50 day moving average? There are so many people using the 50 day moving average, that we will often see extreme volatility in indexes when they cross both above and below the 50 day moving average.

The below table shows the current 50 day simple moving average condition on the 50 most actively traded ETF’s.

Security Name

50 Day MA

Ticker

Barclays High Yield Bond

Stay Long

JNK

BRIC IShares

Stay Short

BKF

Coal Power Shares

Stay Short

PKOL

DB Commodity Index

Stay Long

DBC

Diamond Trust DOW

Stay Long

DIA

Energy Select SPDR

Stay Long

XLE

Internet Holders

Stay Short

HHH

IPath India Index

Stay Short

INP

IShare Russell 2000

Stay Long

IWM

IShares 25 Index

Stay Short

FXI

IShares Australia

Stay Short

EWA

IShares Basic Materials

Stay Long

IYM

IShares DJ Real Estate

Stay Long

IYR

Ishares DJ Transportation

Stay Long

IYT

Ishares Emerging Markets

Stay Short

EEM

IShares Financial Sector

Stay Long

IYF

IShares Germany

Stay Short

EWG

IShares Hong Kong

Stay Short

EWH

IShares Latin America

Stay Short

ILF

IShares Mexico

Stay Long

EWW

IShares Mid Cap 400

Stay Long

IJH

IShares MSCI EAFE

Stay Short

EFA

IShares MSCI Japan

Stay Short

EWJ

IShares Pacific ex Japan

Stay Short

EPP

IShares S&P 500 Growth

Stay Long

IVW

Ishares S&P Small Cap 600

Stay Long

IJR

IShares Silver

Stay Short

SLV

IShares South Africa

Stay Short

EZA

IShares South Korea

Stay Short

EWY

IShares Taiwan

Stay Short

EWT

IShares United Kingdom

Stay Long

EWU

NDX 100

Stay Long

QQQ.O

Oil Service Holders

Stay Short

OIH

Pharmaceutical Holders

Stay Long

PPH

PowerShares US Dollar Index

Stay Long

UUP

Russia

Stay Short

RSX

RYDEX S&P 500 Equal Weight

Stay Long

RSP

S&P 500

Stay Long

SPY

Semiconductor Holders

Stay Long

SMH

SPDR Consumer Descretionary

Stay Long

XLY

SPDR Consumer Staples

Stay Long

XLP

SPDR Gold Shares

Stay Short

GLD

SPDR Healthcare

Stay Long

XLV

SPDR Industrial Sector

Stay Long

XLI

SPDR International Real Estate

Stay Short

RWX

SPDR Materials

Stay Long

XLB

SPDR Metal & Mining

Stay Short

XME

SPDR Mid Cap

Stay Long

MDY

SPDR S&P Homebuilders

Stay Long

XHB

SPDR Technology

Stay Long

XLK

Steel Market Vector

New Short

SLX

US Oil

Stay Long

USO

Wisdom Tree Total Dividend

Stay Long

DTD

Click to enlarge

You should not trade any system trading plan without proper back testing and analysis of the trading characteristics of the index, stock or ETF you are trading.

These trading signals are provided courtesy of the website you are viewing. This information should not be used without research and advice from a financial professional.

Be aware that this condition can and will change any day in the future.

We monitor the 50 day moving average daily along with a number of other system trading plans.

There is No “Holy Grail” in trading systems. Do not use the 50 day SMA or any other system trading system without proper research on the asset.